nVent Electric (NVT) 9 Feb 212020 Q4 Earnings call transcript

Ladies and gentlemen, thank you for standing by, and welcome to the nVent Fourth Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to J.C. Relations. Investor President, Vice Weigelt, Please go sir. ahead,

call and Thank and full an Chief Regina, Financial Sara Vice year of on first and and outlook our provide for I'm we Officer. full-year and welcome, quarter XXXX. fourth our fourth full President the and Relations; nVent's to Investor Beth our year Weigelt, the on quarter Zawoyski, Wozniak, performance, Chief Officer; everyone J.C. you, are XXXX Today, will call. Executive details earnings and provide quarter

the Before statements such we subject anticipated are that outlined nVent's begin, let Securities uncertainties, me with press statements the as remind financial and made you any today's Exchange to forward-looking and and in company's Commission. about risks risks future the release results filings

be made from of no a accompanied Today's reflect subsequent by presentation. the the to company are reconciled update of such results statements I remarks. Actual turn anticipated non-GAAP now, can appendix nVent's presentation, materially to circumstances. which and in over for the found financials the as could website. References statements undertakes publicly And section the have after today, our differ results. events to are time will to questions prepared obligation in Beth. call is Forward-looking We'll of Investors' webcast or

not what year Thank be global workforce for you, playbook not a us our us we none entire that J.C., I There a accomplished. was and And good XXXX of was morning, have everyone. of joining We appreciate and a today. you prouder could could pandemic. imagined.

work and We implemented safety and learned with the great of new how one employees. and priority our number was Our flexibility. safety protocols, virtually to wellbeing

was continue to Our operations. priority second business

continue improved to to and third on often focus quality and growth went we lean many our to on relentless execute stronger same overcame and digital. we serve time, emerge challenges measures our our priority And team Our was performance invest delivery our At in customers. strategy. the with our and extraordinary to and finally,

X. We turning million reduction better-than-expected return to quarter Now, segment. decrementals, with sales strong across Electrical cash Fastening year. the had in to We sequentially & $XX over our finish improved strong generated trends strong flat a Fourth summary flow. and had Slide about sales each XX%. organically on on standout delivered performance sales at cost executive executed and

record at broke continue flow of XX% cash decrementals nVent, sequentially, products at another on in We quarter return the digital our For a sales with to resulting in XXX% readout. for record XX XX initiatives capital free conversion improved XX.X%. We working XXXX. new in as full-year set launches and

to contribution launches expect see a beyond. in XXXX these from We meaningful and

are M&A and On both front, our about funnel. what in we the seeing Eldon we're excited integrated WBT, and

challenging I Throughout is have and been something future about early for these times, focus, in reminded positioned Our on, growth. to allocation growth well said top stronger strategy and confident priority our and win.” “Where executed emerge ourselves I'm We we opportunity. capital I've we

performance. summary on converted show Slide adjusted continued X%. income. strength Sales turn were XXX% XX Now, our performance I down X basis XX.X%. quarter to the would full-year and to quarter for in Return during quarter to net fourth of a contracted as to points million, $XXX we the Cash like of sales approximately

improved. Enclosures recover with sales Fastening the finished and sales & XX% of and year, improved to sales of organically, sales with acquisition growing quarter the our some full even by XX% decrementals costs the year the Europe, sequentially, and were X%, or $X year and billion returned. decrementals Electrical fourth growth decrementals we products, driven as WBT. both For second down exited new temporary quarter since in of continued X%

improvements. in Thermal recovery with sequential expected, saw slower As a but encouraged we Management, are

mid-single-digit key residential, offset our and fourth management solutions. growth however, and pressure relative data of commercial quarter, prefab Fastening in and cycle center continues strength declines. and transit, a and during some Within networking verticals utilities, In we thermal at not energy, infrastructure, grew the in in the longer to while quarter, rail declined, saw Looking also in enough with projects in spending. continued seismic. And we Electrical saw decline MRO & to from recover

we as recovery a While sequentially. industrial continued gradual remained down trends improved year-over-year, see demand to

guidance Looking for and were year. the issuing first we ahead, quarter full

exiting global fourth recovery, and gradual quarter outlook January. is Our which saw into the for a we

we ability year stronger. as While are execute this we grow confident in our uncertainty remains, can emerge we to and believe

for mixed. expectations we anticipate market is growth end in these But year. overall, XXXX verticals Our this

industrial the been downturn. verticals growth a were first return one of to of expect this we to has the out come as to Specifically, vertical historically

While Energy, we In this cautious vertical in we commercial, to grow expect are modest of education in expect to pockets modernization data infrastructure, declines. encouraged on seeing the XXXX. trends are strength see we we and with In grid centers, XG warehouse, we and and continue still are healthcare. around

we to lows our the be However, off XXXX. expect business in

position with Turning a recovery We down were correlation there North to economic down with pandemic within the In India. seems marked improvement emerging saw to in geographies, high consistent the recovery. curve geographical low-double-digits however, performance, that organically. low-single-digits. to of quarter, our on the remained Europe such and general, third America China sales regions' sales as be in improved sequentially,

outlook Looking for strategic XXXX, well and entered ahead. year over full results demand Sara, positioned momentum growth we some we economy and executed and the overcame our XXXX please go We trends detail with in our as on well. respond many turn investments call we made to and and We XXXX. current to recovers. to back Sara will are I XXXX believe the future quarter at adapted fourth increase to drive challenges.

Thank you, Beth.

our here clear with emerge by path this of sit strong in growth, execution. begin proud we stronger. of I'm and we a believe me Let an this is team's financial to It saying, of that incredibly today because position outlook

Sales down point X% were added million Slide XXXX last of relative fourth to year $XXX WBT Let's growth. to acquisition The organically. declined turn to XX% X, to quarter and about performance. review of X

and we quarter by encouraged the mid-single-digits, Fastening sales. improved December both segment were Management was & orders across every are while trends, sales, the better. line fourth with sequentially in Electrical with Orders at Thermal quarter and Looking month. orders Enclosures our down previous with strongest versus in Sales generally

many million, fourth Looking we positive to delivered the better is temporary for Fourth versus execution. improve continue some earlier of which the another third relative the strong decrementals nVent, at quarter than adjusted in EPS our quarter, of $XX Adjusted was actions year. of of our conversion took flow cost XX%, XXX%. gross productivity Free is to summary, $X.XX was trends driven we even January we range. year. continued orders of slightly income and Price at was And improve prior overall guidance quarter. the cash strong see were was quarter and this as to returned. cost by which the of high end In

X a recap Turning approximately ended $X of full results. a included to were from our sales, X% contribution We XXXX year the and billion acquisitions. which down X-point quick Slide for in year with

decrementals, navigate to delivered we importantly, make pandemic, challenges through strategic continue and well we for global costs continued and on executed growth. While XXX%, conversion of investments to of future a this record cash the

and sales of quarter for Now, organically. of our segment fourth declined Enclosures, XX% million please Starting discussion with turn $XXX XX% to Slide performance. X a

trends basis overall income quarter than these versus sales to down, points and this cost We declined food year. solutions, industrial beverage, strength While while other material XX execution controls and prior XX% to recover. networking in of rail lower fully it was saw and the which was on down in expect our we transit, Enclosures vertical decrementals, Disciplined year. did center handling segment and XX%, was relative only and continue and data factories strong any drove return XX.X% continue.

up & strength demonstrating Now $XXX sales of on this Electrical were to and flat X% of organically Fastening, the almost portfolio. million

and The year. continue a to was launches, moderating XX%, infrastructure and performing quarter. sales last team year. income new level utilities nicely with We in is vertical to up well sales and in return declines basis XXX at the electrical Segment conversions, capital XX% relative was to contractor grew points on working up our and both high commercial largest see on relative channel return improving last product improvements

XX% Longer and X projects XX% one-third volume cycle $XXX reductions. during Thermal to $XXX MRO. declined MRO Industrial titled income with quarter in mainly Management sales million in larger projects Net quarter. We due On Thermal mid-single-digits. sales a of to strengthen on Segment which the spend for negative and Management, due and of Commercial down offset roughly declines sheet declined sales account fourth chemical led million cash points ended organically. were the balance XXX were not productivity in volume some sheet remained hand. enough cash return Moving mix impact. year and Europe. the lower sales residential Slide continued We our was of industrial improved up down to down double-digits flow. by sequentially, on and balance although strengths basis to

available an after million revolver of our have We million additional on payment $XXX in $XXX quarter. a the

$XX certainly contributed resilient XXXX. to similar Great us us capital a to and maintain our continued cash be performance CapEx year. flow again at prior to priority cash strong progress to million flow for in Our enabled working and our in

X.X quarter times, times. with exited a titled is which at of X end X.X Slide our the We at net to debt-to-adjusted of Turning capital target fourth ratio to X allocation range low EBITDA update. the

balance good puts us in strategy. execute sheet Our growth invest to M&A and generation cash position strong our a in and

million We investments. launches and expect $XX aim record XXXX. our $XX it asset After in and do a CapEx digital reflecting be product model of year we to introductions, again in to XXXX, and between million light continued

with helps we which shares dilution. component returning dividend during competitive XXXX, XX attractive a offset shareholders. cash repurchased a yield which pay key to of And to continue We million an remains of

X% full-year Slide sales expect to to to nVent X% Moving outlook, XX organically. grow we titled XXXX

in comparisons. gradual vertical, in a growth industrial Enclosures to second benefit expect From more a Electrical utilities strength first in in strong the a infrastructure, the weakness and gains in remaining Fastening the vertical. the the followed most through anticipate expect & from the segment in particularly modest commercial by given we recovery strength within and year perspective, while by quarter with driven quarter and quarters We recovery the we

spend MRO sales. also cost. residential in by items and currency and we modest couple growth driven Management, Thermal For return of A and for to note commercial important in growth price expect

in first, highlight to both price we productivity freight. given environment particularly steel, expect and tailwind First moves with FX recent consistently seeing are A X copper and rates, X have of to we things to expect On price couple driving inflationary inflation as on here: to continue we sales an and year. we this demonstrated. point to currency cost, offset

metal suppliers cost & visibility helps costs. us to out, our us of the Our and which mostly inflation we rolling many provides with at beginning our these price lock or have so Metal and programs, price with manage impacts a help offset year Electrical increases already quarter executed good equation. cost of Fastening, the Enclosures

return actions temporary helps believe recovering and many took year outlook represents the which in this EPS million $X.XX, Overall, pricing from structural productivity cost the and volumes, into XX% year. actions we adjusted This margins approximately actions. to X% of of in Our funnel segment to offset which deliver each is for between takes $XX expanded XXXX. the $X.XX full account XXXX, to relative benefits carryover of growth of we

income strong at flow conversion We net adjusted year another of expect XXX%. and cash or above cash of

we items line $XX of the approximately to expense million, out, rate $XX of net expect of of corporate below XX% XXX costs and other tax calling And to we shares lastly, million XX% interest are a our million. Some $XX million.

on expect downtick By modest Enclosures outlook XX, to to sales to Management, organic a expect Fastening difficult in & challenges and Slide Thermal quarter segment, as first we sequential our at and improvements X% quarter. Electrical due X% continue. be anticipate we comparison related down Looking pandemic in a

in expect plus productivity offset to We inflation quarter. the price

to We midpoint would relative $X.XX expect this and adjusted EPS to last between $X.XX, be the year. flat at be

and strategic levels for actions cost expansion Wrapping I flat CapEx and to down quarter decrementals not In And am emphasize we and modest that last took we April, pleased our the laid our All maintaining say on we on by the we driven of growth, expect the outperformed manage margin scenarios year. on first We in a record up, XXXX. to I to new execution want structural out setting to did plans during proud while, introductions. our I'm products digital investments and back cash. future both. the

year we turn This With we have expansion a my are with Beth. over cash the remarks call set believe a back growth, We the I through margin and and the starting concludes momentum, up seen for will generation. improvement now to strong quarter strong with second sales path steady quarter. this towards

Thank you, Sara.

are want see Turning today investor can through with we priorities upon to consistent XX, further to longer-term Slide you which them March walk Xrd will our meeting. our XXXX our them for and expand strategies. I at

Our to first was operate our Last priority our incidence improve of employees. was remains performance. the goals being X.X%, which Today, safety year, and class frequency at safety well over XX% improvement and set world continue safety rate to levels our a XXXX. we

global Another us social community. are imperative all one as we for as part responsibility, of

here customers are We employees, shareholders. and Xrd exciting meeting. share improvements our plans that at inorganic. during our as and we'll and both is to efforts planet a for an remains time people, to make us, advance for certainly March Growth progress our driving continue important priority and nVent products our for we investor It organic

pursue growth and remain relationships that from our We can We channel aligns verticals everything and trends which to electrification mission expand protect. and strategic partners macro as end higher with to the of our connect continue benefit users. portfolio convinced with such

the at positioned. electrification we trend towards Looking are the everything, well closer of

solutions Enclosures, Let continue center data me build networking to our cooling. out we examples. some including give In liquid and you portfolio,

connected expanding our around tapping Fastening, nVent to Electrical search product example customer the we resulted which in control information. Management, In infrastructure with customer Enclosures. digital and velocity year, Internet into Throughout our connections, experience and presence digital some are the new instant obtain this capabilities and solutions. is Things has accelerated information, our we a our with low portfolio. in our to and In price rate tools industrial bonding configuration for launch build-out voltage An our IEC enables from enhanced & websites are of journey. feature last power with automation This quote of an positioned grounding in to are quickly to better improve grid customers win industrial feature recent utilities, Thermal enriched well Hoffman end-to-end and the solutions. within improved uptick our modernization availability to due electrical We in we of

and and and electrical to building portfolio innovation digital XX XXXX strong this expect We be connected enclosures, introduce another we strengthen driving planning our We're our expanding product approximately our solutions. year to launches. products new again to out cooling smart year, and of control in continue fastening

This intelligence front, digital go-to-market investing the our and drive of data to our $XX we capital is in factories. helping our us On billion and is automation capabilities, we us. improvements. The productivity insights Remember, are use digitization in expanding, the working and highly priority support back a fragmented. top office functions a is compete for that growth. of M&A will drive and also space

prospects. and trend Slide positions Our of bright we up build with The a to on With leading excellence, Wrapping strategy marketing system our benefit we digital, the macro well is management and strong more towards our these on great expand momentum new and and many our our positioned upon for growth Spark are can foundation, products strong sales have everything from brands, brands, products drive trends. and believe electrification our globally. to solutions. XX, to demand we

With to continue to turn As start that, expect a the execute company. call high-performance now to stronger the electrical we and make to to emerge to on nVent grow strategy, we Q&A. will our over I operator

Our with question ahead. line Capital Jeff Please KeyBanc will Instructions] come the [Operator first of Markets. from go Hammond

everyone. morning, Hey, good

morning. Good

Good morning.

segment the of good kind So, color on outlooks.

and Enclosures a makes lot EFS think I sense. of

sharp just you're declines of I'm growth, years modest Thermal, X XXXX. declines little in perplexed just of kind think, given that expecting a and I

see any Just, about your to mean, which and easy of about there? shipping. And how I the improvement piece, comps backlog MRO trends talk you and talk that the I competitors just near-term about some talk on started one think

X/Xrd we MRO projects. in Yeah, to our biggest that because in as stated January. quarter, fourth Thermal we fourth year that into the a up; where see quarter and projects that think commercial, year, improve. roughly we we've back, discussed, last have a driver held always a in Residential to We've X/Xrd, Commercial started and looked we is at spend as Management And reduced through already and, next trend as orders of our is I was going seen coming exited as improve MRO significantly be XXXX. and And X/Xrd,

our so, QX, that a uplift. return And on going had that's sales. we talked on about we a as believe mix mix we're where on the impact in to see negative And - obviously our

it into going we how commercial goes that's will. it to really that's and MRO So improve That that XXXX. it's as see

So I XXXX. we from were we're off where say in I guess, the lows, would

Okay, that MRO have you some so recovers? should a from mix-rich mix standpoint, recovery if

Yes.

announced just, inflation, heavy limited good then color price about. Clearly, And on XXXX again, was as cost. a Can on talked and But productivity productivity year price. versus and Okay. seeing you we're what to you component what just into - of what price is terms built the talk increases, price think or Thanks. about you you guide? and the be your going in you've

and start in can I'll here too. Yeah, Sara jump

exited already - into increases year, announced we we've last So, XXXX. we'd some as price going

still underway, As of years, of price increases. and And, with where inflation. the multiple on we our side some we'll already announced locks. we've price just quarter. recall, And cost done if XXXX, managing seen second what some we that's started the to you in because environments, that had some But them watch we've we're previous come we've in inflationary price just response are to or during are going increases,

price. lot X% inflationary better But expect years we at X%, a depending You do than executed We when somewhere that, as to we between to the portfolio. a say environments. on we're inflationary to of of XXXX always how environments, look these we in in XXXX, point could get want

only the that, to expect see happening price continue I just we with that offset for that that in plus and happening QX to add would year. thing maybe And as we to productivity, inflation full Yeah. we see the

to driving that to well So it relates to of pricing productivity, actions those the talked the as do we're especially as some also in to factory. around, With as well. good underlying that that productivity, logistics as there, Beth relates in and volume, Beth that particularly addition some leverage expect as get efforts about, talked digitization productivity we about it

thank you. Okay,

with RBC of comes question Dray from Deane next Our Markets. the Capital line

everyone. morning, Good you. Thank

morning. Good

morning. Good

I'd Hey, interested I'd fourth Jeff's in like the how way the to assumption please. we came feathered start can pick questions. what And in, with hearing temporary much in in the Difficulty] up left be there we off where of quarter? costs there, [Technical back XXXX? in Maybe And

Okay.

those we picture, million to And cost $XX we bigger did of And roughly costs talked just and QX in roughly was of So temporary nature. execute in when that $XX think some costs, million of those million mark. that that XXXX. temporary reductions about $X of returning, QX roughly in

XXXX, as ROS have today to might one. to that's As feathering from as in we And no in imagine, sit coming here, QX you expect those flat those if in day in and come we're costs costs up also we back perspective. why all because here one a wouldn't structural savings about you we temporary of is that, think QX, in fact, expecting in, in traveling, we those will, in

simply So of relates to temporary a from I say third that T&E. that cost perspective, roughly would that

time to kind in. to going so, feather that's take of And

of just chunk discretionary that Another is spend.

million in And out QX. that in top-line that of of coming you'd recovers. XXXX, the a Deane, in half see cost, a front. point only flow the about to talked we I expect we to would Maybe from in, based really first structural largely what this $XX bit really savings kind of that on that on as into other is did so, thing, in was trickling come action year, cost you'd XXXX expect in the And

that there for free of any some specific in for a of kind from appreciate I know timing. all success working looking as one just I and some you capital? one-timers insight goals one-timers payment the Sara, were And which those cash over percent CARES Do can give on you in companies think And which into XXXX, stories of just some you your tax on sales? there specifics. here gave those XXXX? on numbers have then, Is the of I us some is benefiting? the you're dynamics any Act, confirm, relief benefited flow, on

about feel the from to year improvement flow cash did, record so globe the being supplier We mark? DPO] work looking conversion, great Yeah, free actually contributed at on of teams the [ph] saw for data-driven some XXX% really working based our our terms. on across really a some us perspective, Certainly, performance harmonizing [a we that that capital that.

came in working thing I to suppliers But & getting would suppliers. every What looking also the over out to really lead-time drove can They XX looking planning. point the lean, inventory and every specifically, to vendor-managed Electrical demand think there efficiencies, when for side. to improve in be further are at really business. improvements other long on inventory the plan part, that capital, ways supply-chain improved Fastening and our advancements metric extending programs it we that at

million impacted of what million XXXX. X improvement. and say standpoint. points $XX focused cash overall $XX So payment would of some see be percentage we're say as runway a there from sales Over multiple I is our further top working capital And to could for benefit XXXX, we absorbed on. us restructuring perspective taxes, those see I also inventory the But some an a as the I timing roughly and of From - capital continues in payroll I we that of roughly well. things. time, did area One, would deferral of also of say working would efforts that of

some that to performance. cash takes we overall and So flow free puts had

- to - flow I a because about then, shouted gave a good free those added results. cash from that's shout-out. glad And and you really large companies the know you I'm it. of are guys number include for just of that piece operating I quality I excluding last And restructuring, earnings

of all it on new period to terrific. the me. other for in I is continued just point product think was have a That's introductions. The COVID innovation that impressive output Thanks.

Thank you, Deane.

Nigel will question line come from Wolfe next with Our Coe Research. of the

Thanks. Good morning, everyone.

morning. Good

Good morning.

I how margins, So weakness But pretty had the EFS - does saw in obviously expected. we we outsized just saw - framework the to with and of flip in much outsized I'm we the sort just Thermal Thermal this really bodes of what MRO? curious, into So expect that wondering year, downside, how to does be recovers roll I'm maybe should operating EFS helpful. to we sort there if on and would XXXX? leverage be then impacted And the just any trends color

moderated see to And a from from EFS, drop-through. expect, XXXX, discussed back industrial opportunities but from through as recovery strongest you Thermal, expansion earlier, of year one, We do still verticals. as just we're full biggest from really in would growth that we Thermal. what expecting do a in really our lot margin expect a be might overall and growth; So help to and Thermal. And should and margin business. that the we expect an Enclosures of getting perspective, we MRO Enclosures, two, that more it overall coming that our versus expansion that higher in Enclosures part because be

part the restructuring million XXXX, take separate Yeah, the that we should when in then, think of is productivity and that as price, savings And material inflation productivity or bucket? $XX raw in EFS outstanding. about impact of was we

That's of be going to part productivity.

Yeah.

given in in got deployments, guidance. buybacks what capital I'm you've just share Okay. XXXX. count for then, baked just And us on wondering That's you helpful.

reflects guidance our really goal offsetting overall a I dilution. of mean,

that offsetting year $XXX over with And the so, full-year million we really so, share ended that dilution. count just diluted is XXX and million shares, the guiding to of

But to have to overall buyback, a M&A about be Beth may continues prepared strategy. goal getting our more and as our get we share to in bit number. So our do talked just to that after remarks, growth overall,

Sara. Thanks, Right.

from line with Our come Julian Barclays. the of Mitchell next question will

basis good XXXX. a Maybe margin in on the you're guide, trying for it segment Hi, for the a to firm-wide XX% so incremental just morning. about dialing at looks pre-corporate margin like look

Just to related QX. check, And in you'd X, $XX of roughly at wanted that's productivity then, out looking if to double think gross correct. that, I called million Slide

investments million So that for inflation that's leaving and $XX piece.

number $XX Just wondered does that for XXXX, look like? million fiscal what

me let part Incrementals… question so was first Okay, of - here? the the what

yes, okay, sorry about incrementals, that. so On

thinking an full-year incremental all And perspective, December expecting than to price/cost about incrementals things things. of majority range. dynamic. sort how be that reflects, are just we So and to is what really we really X of really mid-XXs from yeah, One in that the different in related is it that were

increase inflationary really being productivity. offset XXXX, to about rolling as environment, with cost expect situation that in actions productivity We've XX% but impacting again, And QX, these price, really It's expect that, Obviously, that year. QX, that talked in dynamic. outside to with about that, XX% million. as earlier, that inflation looking So overall but I mean, more pure that in is just that, is in context that's continue to overall for price, QX, way back get range. volume from offset we But number full incrementals talked dynamic by that increase. ramp roll you that's incrementals. a run from that gross the to expect that out an a that to modestly temporary strong. will overall impacts the of in. It work $XX to QX, that price/cost dynamic, would those those an would and bit drop-through of along rate back coming some we inflation of muted with say we of do to to we of QX, that From I

as price increases here the monitor to we We and context continue to monitor taken QX, about, in that it. already And talked we've as of we'll continue Beth go. multiple

then, looks for easy Thank an in not you. secondly, is okay That's like one. helpful. year, And an Thermal

next - how is as of try you wondered, downturn. upturn? with deemphasize, position something more been portfolio there during there the the the And with you thermal's do whether it surgical that to to reemphasize I satisfied you're thermal, within strategically, better kind Just performance or and appetite trying have areas for suppose if this are

the also pandemic, I our is business structural think, with This into the what we also as Yeah, we took segment cost segment the impacted the we the as oil. was downturn went most thermal happened with and certainly - that most of actions. price

And so from got that I think we standpoint. that quickly very on

you repositioned in part how that's that go so next we And year, as see we've of business. - what into

Our really that segments, those to that off continue the because like because so we view have that we large MRO going spend invest that quickly, a other is installed to And areas, dropped we're in strategic improve. - base. see

a with opportunity, and as is connected our where to And let's So commercial the side also be. of is, can in controls we we're anything that's residential going that investing forward, growth think ensure the about positioned that retrofit priority. been view the do go we as kind side

So in example, we as to know about there's projects, be we we investment forward, APAC. when going example, chemicals, that go think for for in

resources that areas grow. we're we're ensuring so our are in going is And that where and or prioritizing those our focus putting to

millions as and looking So whether we're And it's on forward. heat high we trace to guess, and just a that part or for automation, always we've of sensors our believe cable the base out helping to And we continue industrial to and acquisitions solutions, last because it's and we're us right in got are in controls is, there that it's that growth, whether from that standpoint, making us sense, done positioned do to the and resi makes as sure products of have data our really and growth, going networking global portfolio. focus we there, that. go seen question position whether we're optimize of what you've installed geographies opportunity mine I commercial, the the MRO everything and we've

Great. Thank you.

Our comes line with Ritchie the Joe next question of Goldman from Sachs.

morning. Good you. Thank

Good morning.

of by - your sell off levels, I'd inventory on guys much also are that start downtick is you just Maybe think, any business? maybe color today. in then and provide think inventory you through And be I secondly in influenced kind on to levels that how distribution. XQ, starting the expecting of you two-thirds of that that you're can curious, year you're what EFS business where the that like on being seeing

up rebate happen there, it's things think - expected really year on call, recall, demand quarter, in that were match because you'll see to - were distributors the were I of And the I'd inventory that seen going say improve stock that distributors cetera. we sequentially demand, we talked in a seeing. couple into that continue the our respect improve saw. of meeting that fact to a improve, this, demand it and where we a expect end in seen But times of what lot programs, of the with earnings we et we've we've to as last exactly that's about as end inventory to levels fourth And So us we at they and we the January. didn't just like year, shared

inventory we're levels gradual So that of I matching improvement seeing still demand. think

there, So still year. just more let to I runway I'll then that. Sara we would go EFS, talk the as throughout say on And

Yeah.

guiding we're from a a growth So to organic ago I year more a we in that flattish that just say, QX. would comps of downtick Joe, really that rate of saw roughly it's modest function of

see more we than January for no segment, broadly January in this So in said here strengths we overall. different what

growth How from of this of coming that longer-term as expect great. think see look through part on that you longer-term to a the launches algorithm for maybe and growth as investments all the launches are currently? you the you well. making how then like, all the guys thinking doing this you're curious, do Okay, the you're do And when company, the quickly to of great see this all I'm product just for can question digital launching much it's about you Beth, contribute? some

Yeah.

about Our year. growth products new product new new talked from we've in And point our get today. products, about getting of vitality the every to us mid-teens recall, XX%. see a like to we'd up We're

drive going productivity. of So it's it's On that's digital, our about drive cases, enabler, point an cases, to us to drive other somewhat right. helping In that some growth. and helping expectation us it's a it's of growth

would investment that out kind that we really closely of both as these an terms project. we we tracking builds the getting But say launches it are side, is of of what all the we laid new we're returns as into equation margin expected, growth in and those expansion. see digital what I So

in we're about we of approach see And what's or I that So I doing these success at, get as very than think think adjustments to nice we've a quickly go. adopted, we is to terms really that able done the job ever being efforts. going value the we're make agile only that we're better to. at from And are we've better looking getting

you Got both. it. Thank

with Vertical question of from Andrew line next the Research. comes Shlosh Our

provide in with is Hi, quick rate data growth Sprague. for centers. Shlosh trends on quarter this in just seeing I squeezing for you're precise take on centers one the data some you Could of here. us there? and Jeff on more me Thanks the Andrew

we would networking strong was the say front, global from saw orders, and and really on overall I a importantly where data in digits double perspective, Yeah, a right.

remember, the is I in cable hyperscale, So on that WBT offering year a management early if acquisitions for in see of new where some one that of whole we growth mean, the we in tray the brought that was you did space. that

that's So really rate. into double-digit double spun has that the would would to we and since digits heading growth again expect for back get something grown that us XXXX it

cooling, data and trend strong impacted our solutions to can't more that see order Yeah, we just around as sites. and around pandemic have we liquid started we and double-digit the said, believe way, grown last reason complete think, we especially that this sites networking growth, solution again, integrators the we've continue we then years, I of no in more digits - portfolio, about pre-pandemic XXXX, occur to obviously, like for were shutdown, think there's double But it on we job can't built with couple management. get as to to in cable so Sara out

where positioned we're So about excited long-term we're growth. here potential the and for

the baton. the Great. for Thanks pass color. I'll on

of question Rosenblatt with next the from comes Scott Securities. Graham line Our

of the really and I were wanted quarter model. good comp, what your you then is looks because it? in that of much on some sort second - sort first organic the cadence second then I they'd and first year. on bit than the for year kind number on thinking worse Would plus certainly of easier of all, and in mid-single of or be what of up the in that, EPS, here Hi, half rest thinking my way that decline the ask the of morning you're quarter for sort low-teens essentially only quarter be given Like, less the of XX% well, a the was congrats about I the a little markets to know you face.

Yeah.

cadence right. Scott, about So, that sounds

that to low-teens? And be know, then what kind this up that for the is one going would the markets biggest big down are the second factors see is of number quarter, sort from what you an I comp, the of, but the obviously

Well, always us constrained. downturn in levers all that that historically, said out of period. of we one And CapEx we industrial - a quarter, we what everyone is I know we've that lead those seen was

would So as to we vertical data year, as well, those lead strong the growth we throughout key orders double-digit expect be solutions, would that areas. mentioned that to we also expect in would and the seeing the as industrial that be way go we networking

quick other Two Okay. ones.

the XXXX? new Would point that about this of made, in be the case expect that goal X%. that's the products the year you to On adding you just

- think, efforts get so to those last Because, we've And I launched. if we done would. we extraordinary Yes, contractor XX some year, products conversions.

build see that this so seeded And that year. place OEM, XX so, at we'd expect some with another to for example, we've new And upon take we'll products.

share what you. is do impressive. question a get earlier were to dilution? That's outstanding about share - you the capital, and thinking? asked a don't we than third placeholder second question to repurchase At way become so repurchases. trigger than more Thank And the acquisitions last large the manifest in quarter Nigel more very authorization. What And quarter? you obviously year the around is If offset a there? point that the Yes. have necessarily When does

work. Yeah, that throughout we - always repurchases feel do the dilution. our you've based seen share we always put we it we've to very as I us, front cash hanging our the on just wouldn't mean, balance funnel but I we've some we said confident and if sheet, we're - think But and year, opportunities in although, in of to on have go going

looking Scott, of do see constantly year a some at the opportunity us that couple I we're think of that, So course do going to we're for over acquisitions. this although to

lot for your a Thanks time. Great.

you. Thank

Thanks.

G. of Your Bergner next question comes with Justin from the Research. line

morning, Beth. Good morning, Good Sara.

Good morning.

Good morning.

to on things control delivery Nice you're able this in environment.

Thanks.

mix? the margin neutral, to margin be which guess coming is mix regards positive from you in that margins expect I coming some is Do are X ask, expansion, to or leverage to - want I is from guide, modest volume that start, To margins?

both. would So is that I I the way guess answer

perspective, XXXX. from an leverage going to help clearly, So overall that's volume in

sort impact the So And mix being MRO some not recovers, expect only drive that that but business it And particularly would that in then also double-digits. strong growth, thing. be is that here two, of which would as negative impacts fully to down I help, an one side on we outsized in we'd mix expect based seen positive of mean, drive thermal you've XXXX the as profitable to highly business, well.

be offset segments I of other some than guess, faster right? growing Okay. that by, would But EFS, the

But within basis, Yeah, portfolio and have a going of see clearly at each thermal to one in otherwise is Enclosures than mix positive some segments, kind to offsets of might a EFS. you'd management play in again, the bigger have total what these there. we

Okay. all the expect X that and some side, of grow more That's And helpful. MRO in then do you the XXXX portions residential commercial thermal business, of in the or the them be project, neutral? will breakeven to

our always have most have how some softness there. is resi industry some we expected we expect we outperform strengths, view resi, should the the But want in commercial to expect MRO, and growth commercial to is. is So

projects, the how of that plays over the see respect with the to year. the think, over course we out see we'll of flattish So I And year. course that

of where. that temper continue kind economy the And economy that's we'll just and how the why we're we'll is how that's just see when recovers So we dynamic, to uncertainty, there's, still in but viewing. how still that saying there quickly see recoveries - and

X% back from of of XXXX? that to XXXX back of just XXXX X% or down full XXXX, thinking in Do sort a as the bouncing getting is recovering of XXXX in in a expected the XXXX. more more you And Okay. lastly organic materially think level organic maybe growth event, decline about XX% growth organic then

I'd see economy may how of - we it's depend the the around world. on Well, the the say it segment, recovery - just I timing and again,

commercial is if that recovers think think So take expected start us we lead it, to going that's as we down how into could think about XXXX, think that as the first. slightly about industrial I you see year. to we to And vertical that's this be

to that but recovers year, I to Well, going think, it's into I we're is that to view next rate. And improving. a we'll tough this going slower relative be that, think year, maybe improve is see. so energy the And that's improvement

So those strong. X different dynamics there should be infrastructure and

XXXX. includes All and solutions by networking and infrastructure others that to us those we different So and and expect dynamics XXXX, for is strong. likely call to be in utilities, maybe data out segment, we recover some

That's helpful appreciate you. framework. very Thank a Okay. I it.

Silver King. David of line the from come will question CL next Our with

morning. good Yeah. you. Hi, Thank

morning. Good

morning. Good

was comments Yeah, to parse outlook. great. about kind I hoping of of maybe your cost the some

out, But elements your costs of and was So the productivity. material logistics year. I've I to for expectations heard raw next hoping cost I've your tease of inflation, heard

electrical guessing leave you pressures, talked metals, that quite bit a shortages greatest I'm the out I'm the chip cost thinking on outs. also talk raw about could course, But see temporary of but and labor, maybe have out about cost where leave you the So, components the of been material side.

of So then and that anticipate? ability capture availability, assess Thank to whether you kind that disruptions, raw and it's whether material, to operate you cost, logistics incremental to and recover the it's costs maybe do continue how the you. without

Yeah.

talking more And resiliency. talk then, Let me let side. about I'll cost Sara about by and start supply - then just start, I'll chain the

our of most mentioned we as recall, materials are metals. So

locks. terms And just in so how procure supply do price and great these our positions of we rolling have we

to good quarter would have we this able say, supply even that would the some I we right as good our a position access to improvements had and - that sequential feel to saw we components, that year there. so the in we fourth at we so we our of look we be And be chains, ensure expected in and looked positioning about areas as in respond.

on our and supply parts inventory our was side even addressed of factories. we've that own they the - a in requirements whether lot can because capacity, So or on capacity just

for us disruptions this minimal has see all and at point, think, really I our robust we've - we chain of XXXX. been supply So

position so working with channel. we're with actively that And supply we're good distribution very a working and also to own our in ensure through that the

well. fairly we So going scenarios I keep that. to managed we're but got to point, again, year, the think And we've supply this goes think, at having we'll to be over how chain see able demand the respond to

cost about So side. Sara the talk then I'll let

so Yeah, overall about metals question think think materials specifically. and I your of kind around how was to

And So, Beth be a materials going locking good copper gives kind XX% inflationary access really is little into we great these of talked overall lot of and times about, metals are of as supply. programs, a than And and half us that. lead nickel. these less those roughly that bit to some with visibility about it steel, of And and feel of pressures. the sales metals are to

manage as dynamic. to ways as as continues progress, we'll earlier, is we to look and feel It got productivity that. to dialed inflation monitor increase, in, pricing, we'll that, in things we've If Q&A, And continue Beth you that we look to alluded will. So, like if the we're right. going at at to

maybe the you of in Okay, sequential quarter. for a progression revenues thank fourth you ask I'm going the about question to that.

segment stronger had it beat and So, segments, was in by overall, scratching I'm you segment, But there year-to-date, go your of at back, your kind X I the exception. a you overall. kind or of did met revenue performing guidance if And the those look X saying, I decline was I your head my sequential being - I was - was of mean, revenue I thermal and segments. mean, guidance been

were Enclosures? and surprise you segment? So segment for revenue there words, there EFS there, I'm so a overall, by surprised that much sequential but decline a wondering, was other just In was not Thank you.

right that with say expectations. would in line I was our Yes,

to segments, as our as look just of Enclosures in you of typically, well at in downtick the If seasonality from QX kind a QX, there's EFS.

and are expected line in downtick. seasonal those of kind with that So as

And Okay, new or right is from in point question, then, launches. But that this time? as launches, call thank words, that. cite question, you of you just there for of market product couple could the XX-plus their mean, innovative two due are or Thank product - one of at being, you kind especially high last a capabilities an company especially either mentioned for your just for they're you hitting might I to the bright growth year or So are out the their a last prospects overall new maybe handful you. is that that other right products, your there especially about? XX/XX the a either optimism

Yeah, categories. of okay. sort that a release to In our maybe of I mean, Thermal in Management connected I'll continued we've lot give business, solutions.

So MRO present also we're opportunity. a they an great excited our we about that that, new because customers only value believe they're perspective, on project not for but

data globalizing terms go Enclosures, having value there's while. I been back in as in I'd cooling, ability products have networking out mentioned, very just et solutions controls a largest We've and portfolio, for in very those general for out can around on our in out well be more controllers monitoring existing create there a IEC journey that say capability, excited us. as building And well category, of around that. we're ability business, prefab, particularly we're this electrical and what example, but And we've our for portfolio. grid portfolio for we about similarly, there done as drop the our capability and about So side we very have to performance, with and differentiated start there the X to that base, replacements been ERIFLEX better cetera, range. - our see installed capability have out, able our been of and We've that. And see of nVent are build areas launching categories and EFS products. excited anything And in think say our contractor in products extended some would into really the seismic then, on we've business, you conversions with CADDY result. a as that extending well do EFS our there our position the new just I to us we to around maybe utilities,

electrification So, trend. all those into of are those playing

that at excited our broadly able customers create we we're be growth we some believe - higher and about, pointed So that are those to opportunities. positioned categories because have, for and differentiate they're they value to

That's very great. you Thank much.

We I'll to time. further turn over have conference remarks. back no the questions further this management at for any

Well, this thank you for joining us morning.

to at with help set pleased are level quarter and success. us We fourth our during we growth up believe a for and performance executed XXXX high

for our work put global emerge We employees the forth hard help grateful are to stronger. all us

uncertainty for to remains, execute We This to growth. us. safe we in ability have forward confidence to you speaking our you X, again deliver at concludes our our on economic on and and Meeting. Thanks XXXX While you. look March call. hope priorities remain joining Thank Investor the again

for today's call. joining all you thank gentlemen, and Ladies

disconnect. now may You